Instability in Korea inflicts the most damage on China

The arguable calm, which has been established in East Asia after North Korea's last nuclear test, the subsequent sanctions imposed by the U.N. Security Council and the United States/South Korea's joint manoeuvres, was welcomed by the Chinese Communist Party (CCP) in Beijing, where consequences of this next-to-last crisis are being carefully reviewed.

The new generation of Chinese leaders (emerged from the 18th Congress of the CCP in November 2012), directed by President Xi Jinping and Prime Minister Li Keqiang, faces the gigantic task of reorientating the country's economic model while promoting a more proactive diplomacy. In the process of engaging in global issues, they refuse to give their approval of the last actions of Kim Jong-un’s regime. Every time they have to redirect their energy to deal with the North Korean problem and these vital tasks are neglected, they lose their focus on modernizing the country.

China's disappointment with North Korea reached the point where it even gave its support to the aforementioned U.N. sanctions in an attempt to reduce the uncertainty installed in its influence area. Nevertheless, shortly after the approval of the measures, China backed off and urged all parties to remain calmed, reminding them that nobody has the right to generate instability in the region, especially when pursuing selfish goals.

Given the fact that the North Korean attitude affects a number of countries, there are three main reasons that explain why China suffers the worst consequences in this instability period: the impact on its economic growth; the need to deal with its own challenges; and the U.S. military forces stationed in the region.

China's first goal is to keep the international environment, specifically Asia's, as stable as it can be. This means that it needs favorable economic surroundings for its growth in order not to reach a deadlock.

The Chinese economic model, based upon its great exporting power and on strong State investments, is already starting to show signs of exhaustion: GDP double-digit growth is long gone (7,9% in 2012) and the reorientation of the economic activity towards the internal consumption is yet to be tested.

In this regard, China's immense economic ties with South Korea and Japan become even more important (commercial exchange between these three powers summed up 690 billion dollars in 2011). This can be also said for foreign direct investments, of which China is currently the World’s main recipient. Both aspects could be seriously harmed by a warlike conflict in the Korean Peninsula.

Besides all of this, the possibility of a Free Trade Zone agreement between China, Japan and South Korea was suggested in 2002, and negotiations for a Treaty are being carried out at the moment. Achieving this goal would mean that 1,5 billion people would fall under the limits of the FTZ, which is roughly 20% of the World’s GDP and almost 18% of all international commerce.

While Chinese leaders are facing domestic problems of more than one kind (Tibetan and Uyghur separatisms, growing demands for a greater economic equality and freedom, corruption, environmental challenges, etc.), troubles with North Korea, the struggling neighbor, are certainly not welcomed.

The CCP has to give answers to the questions raised by the middle class, whose living standards improve every day but that on the other hand suffers from an increasing inequality gap between social classes. Criticism towards the authorities, voiced through social networks, arose from the young and urban society that has some insight on how only a small amount of people benefit from this Chinese miracle. Their demands for more social equality are growing day by day.

Furthermore, the nationalist and ethnic disturbances that recurrently occur in Tibet and Xinjiang province, demand attention from Chinese Government. The 2009 riots in Urumqi, the capital city of Xinjiang province, are sadly known because approximately 200 Muslim Uyghur died that year. Events happening in Tibet, like the uprising in 2008 with monks burning themselves to death, are a constant source of international shame and criticism for China.

During the 18th Congress of the CCP the importance of the “ecological development” concept was put into value. It means that every economic, political and/or social action has to take into account the necessity to preserve the environment. High levels of air and water pollution often force Chinese citizens to stay locked in their homes, and are a direct consequence of the low number of controls in the industry, which is still based on utilizing coal.

Among the challenges that are threatening China in its inner territory, corruption is one gaining a lot of attention from the new Government. In the words of Hu Jintao, previous President (2002-2012), "...if we don't succeed in the fight against corruption, we could face the failure of the Party, and even of the State". Whether or not China will take steps to end this scourge that affects high-level politicians and local leaders, still needs to be refuted.

U.S., which has security treaties signed with Japan and South Korea, uses conditions in North Korea as an excuse to intensify its presence in the region. In consequence, Beijing fears that Washington is exaggerating the North Korean threat and taking it as an opportunity to modify the nature, the size and/or the characteristics of the military forces deployed in the East Asia scenario.

It cannot be forgotten that China, although promoting a "peaceful rise" on its way of achieving the great-power status, is the only country in the position to challenge the U.S. hegemony in the region. The Chinese defense budget, in spite of its growth of "only" 10,7% (in relation to 2012), amounts to around 90 billion euro - only the United States spends more in this category. Since a long time the funds have been invested directly in the enhancement of its army equipment and therefore in its external projection capacities. This is the main point of anxiety of the U.S. and China's neighbors, who have maritime conflicts with the Asian giant.

Chinese leaders have always claimed that the investment on military development is purely defensive and aimed at preserving the security of its borders. However, it is inevitable to assume that the U.S. doubts this being their only purpose. While making the most of the North Korean crisis and using it to display its huge technologic-military power to the World, they reinforced their traditional control of the Pacific area and sent a strong message to China.

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